Country Trading Profiles France - Taxes

Tax Rates

Nature of the tax: Value Added Tax (VAT)
Tax rate: 19.6%
Reduced tax rate: - Reduced rate of 7% for food on-site consumption (restaurants), Non-reimbursable medications, Tickets for entertainment, Passenger transportation, Books, private televisions channels, water supply, Real estate transactions, Supplies of housing in hotels, Goods originating from farms, animal feed products
- Reduced rate of 5.5% for sales of certain foodstuffs, supplies of electricity, gas, or energy, and equipment or accommodations for the disabled.
- Reduced rate of 2.1% for certain products reimbursed by the Social Security.
To find out about the rates valid in regions outside metropolitan France, click here (in French).
Other consumption taxes: Domestic consumption tax on petroleum products (TIPP)
Domestic consumption tax on natural gas (TICGN)
Domestic consumption tax on coal and lignite
Domestic tax on tobacco (snuff and for smoking), cigars and cigarettes.
Domestic consumption tax on beer
A 2% tax is imposed on hotel services exceeding EUR 200 per night.

Normal corporate tax rate	33,1/3%
Companies with a turnover of more than 7 630 000 EUR , companies where the share of individuals in the capital does not go over 75%	33.1/3% + a social contribution of 3.3% of the corporate tax payed
Companies with a turnover of less than 7 630 000 EUR and those where the share of individuals in the capital goes over 75%	Reduced rate of 15% on the first band of taxable income within the limits of a total amount of 38,120 EUR.

Tax rate for foreign companies: Foreign companies are taxed on the profits they make in France.
Capital gains taxation: Long term capital gains made by companies subject to corporate tax (IS) are not taxed.
Main allowable deductions and tax credit: Expenses are deductible for depreciation or amortization, reserves, rents for premises and equipment, wages, etc.
Tax credit exists for apprenticeships especially.
Other corporate taxes: From January 1st 2010 the Professional Tax was replaced by a Territorial Economic contribution levied for the profit of territorial governments. The Contribution Economique Territoriale (CET) is a local tax imposed by the departmental and regional councils on businesses to assist in the funding of local services and the Chambres de Commerce/Metiers.
A Flat rate annual tax (IFA) is also levied on companies.

Personal income tax (IRPP)	Updated in the Loi de Finance 2011. Progressive rate up to 41%
Up to EUR 5,963	0%
Between EUR 5,963 and 11,896	5.5%
Between EUR 11,896 and 26,420	14%
Between EUR 26,420 and 70,830	30%
Above EUR 70,830	41%

Allowable deductions and tax credit: Child care, consumer credit, tax credit for young people under 26 who take a job in certain industrial sectors or geographical areas in difficulty, etc. For additional information go to Cabinetgregory.
Special expatriate tax regime: In France there is a special expatriate tax regime. It especially concerns health insurance and complementary retirement pension contributions and the possible exemptions. For further information, consult CIC website.

Countries with whom a double taxation treaty have been signed: France has signed fiscal conventions with over 112 countries in the world.
Withholding taxes: Dividends: 25%, Interest: 18%, Royalties: 33.33%
Bilateral agreement

Tax Authorities: Web portal of the French fiscal administration
Other domestic resources: The fiduciary review
Information on French taxes
CIC Bank information on the French Tax system

Tax year: From January 1 to December 31 .
Accounting standards: Official accounting plan (PCG)
Accounting regulation bodies: Parliament
CNC
ANC
Accounting reports: Annual accounts: the balance sheet, the profit and loss account and the notes to the accounts.
The annual report
The statement of source and application of funds (compulsory for large companies)
Publication requirements: There are three levels of reporting: The basic system (Normal), an abridged system (for small companies), a developed system. They depend on the legal form and size of the companies (defined in relation to the total of the balance sheet, the turnover and the number of employees).
The reporting is annual, except for listed companies for whom reporting is quarterly.
Professional accountancy bodies: OEC
CNCC
IFAC
Certification and auditing: Companies have to seek a statutory auditor to conduct an annual audit of the financial health of their organization. You can contact an external auditor: KPMG, Ernest & Young, PricewaterhouseCoopers.
Accounting news: France accounting news